Vivendi will decide whether it will sale all or part of its 61% stake in Activision during an annual, senior executive meeting later this month in Corsica.
News of the possibility caused shares in Vivendi to jump 5.3% in Paris, as sales of company shares would “unlock value from assets at a discount because of the holding structure at Vivendi,” which also owns Universal Music Group and phone operators in Brazil, France, and Morocco, said the Bloomberg report.
The firm previously sold off 60% of its shares in November 2011, in order to keep its credit rating high. The sale of shares in the Call of Duty maker, which has a market value of $13.4 billion, would reverse a 28% slide in the Paris-based firm’s stock over the last year, those familiar with the matter told Bloomberg.
“A single sale is actionable, but it risks being a short- term solution,” said Claudio Aspesi, an analyst at Sanford C. Bernstein & Co. in London, who recommends holding the stock. “Six to 12 months from now, questions will pop up again. What happens next? Why does it makes sense to keep the rest of the assets together? Is there any strategy?”
Activision is Vivendi’s fourth-largest company which reported sales of $4.76 billion last year and shares in the firm have risen 4.5% over the last year. The publisher was also Vivendi’s second-fastest growing unit in 2011, as its Brazilian phone operator GVT took the top spot.
According to Bloomberg’s sources, Vivendi has yet to decide what it would do with the proceeds from any sale of stock, but that will likely be discusses at the meeting as well.
As noted above, the news has driven Vivendi’s stock up, but Activision Blizzard’s has dropped by 3.3%.